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Posted on 08/04/2026 8:25:33 AM PDT by yesthatjallen
The U.S. Treasury bought yen on Friday to support the battered Japanese currency, the Financial Times reported, marking Washington’s first yen-buying intervention with Tokyo in more than a decade as it languishes near 40-year lows.
The Federal Reserve Bank of New York sold euros for yen on behalf of the Treasury through Goldman Sachs and Morgan Stanley, the FT said, citing people familiar with the matter. The report did not indicate any amounts of yen purchased.
Earlier on Friday, the Treasury informed a number of banks that it might intervene in the yen market and that they should “stand ready for future action,” a source familiar with the matter told Reuters.
A Reuters photo of Treasury Secretary Scott Bessent’s notepad during a cabinet meeting at Camp David in Maryland showed the words “To Do,” followed by “Buy Japanese Yen (JPY) $5-10 bil.”
SNIP
(Excerpt) Read more at cnbc.com ...
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$5 billion is like a tip to a waiter. Insignificant on its own. But it sends a message. Trump’s intervention in Argentina worked well. Bessent seems to know what he’s doing.
The U.S. is supporting the Japanese yen primarily out of self‑interest, not altruism. A collapsing yen threatens U.S. Treasury markets because Japan might be forced to sell its $1.1 trillion in U.S. government bonds to defend its currency — something Washington urgently wants to prevent.
weak yen forces Japan to buy yen using dollars
To stop the yen’s slide, Japan must sell dollars and buy yen.
Japan is the largest foreign holder.
If Japan sells too many Treasuries, U.S. borrowing costs spike
Large-scale Japanese selling would:
Push Treasury yields higher
Raise U.S. interest rates for consumers
Disrupt Federal Reserve policy
Increase U.S. government borrowing costs
This is the core U.S. concern.
Just got back from Japan about a week ago. When I was there the rate was 160 yen to the dollar. Things were CHEAP.
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